Why aren't Bitcoin and Crypto Rallying on Positive News? (Clarity Act, New Fed Chair, US China Deal)

本站添加: 2026-05-17

[00:00:00]There had been three major catalysts that have lended over the last three days. We have the biggest crypto bill in crypto history passing the banking committee in the Senate which is the final blocker that um have held this bill back for the last eight nine months. This is the clarity act we are talking about. It is advancing to a Senate floor vote and then finally to be signed into law.

[00:00:34]We also have the new Fed chair coming in today. Kevin Worsh is going to be replacing Jerome Powell and can he actually make a big pivot on Ray and on QE? And finally, US China has reached their latest round of deals and they have produced meaningful results here.

[00:00:55]So all three things are supposed to be super positive on paper, but the markets and especially Bitcoin sold off after this news. So Bitcoin is trading just below $80,000 and it got a very clean rejection at its 200 day simple moving average. Altcoins have shed $30 billion since Monday. um from total three uh total two market caps and the fear and greed index dropped six points in the last four days even though we only had positive news this week.

[00:01:41]All in the meantime, the equity markets especially led by AI is hitting record highs. So crypto still couldn't sustain a breakout. What is leading to this dichotomy?

[00:01:53]This is what a classic sell the news environment looks like. When Bitcoin is in a bare market, there's a lot of short-term good news. People are jumping into the market expecting the news to pump the markets. But as these are just short-term uh catalyst for Bitcoin's sentiment, but it doesn't create the long-term effects until at least a few months later. The good news becomes bad news. And when the news drops, it stops moving the price and price goes down. And that's why I've been telling people that I believe this rally is tending to fade after all the news are over. So today, I want to walk through all three of these catalysts that dropped this week. uh especially I will tell you why the uh the clarity act is not going to introduce immediate buy pressure in the markets and uh why this is reflecting exactly on the charts as well and we will also cover the new fed chair coming in the exact charts uh to track on there for rates and for yields which is showing that the market is not reading seeing Kevin Worsh as a dove, as a um helping hand, as a bull for the market, but instead people are actually very cautious as with him as a new fed share. And finally, the Trump Xi visit in China, what does it actually benefit? It doesn't benefit every single market, but there are things that will do well, while others are going to fade be due to the short-term sentiment running out.

[00:03:36]Okay, so that's on the agenda for today.

[00:03:42]I see people calling about Treasury yields going up as well. Yeah, exactly.

[00:03:46]So, the devil lies in the detail here.

[00:03:51]All right, let's get right into it.

[00:03:55]So, the first thing I want to cover for you guys is the Clarity Act. So we have already given a full breakdown of what the clarity act is and why this vote uh this week is so important.

[00:04:12]Long story short, uh the clarity act vote needed to get past the banking committee stage in order to move on to the full Senate vote. And this was the final thing that the market was getting blocked on. Uh well to yesterday we finally got this vote. So it seems like to me that the Clarity Act eventually will get passed. We have jumped past the most important hurdle. Very positive news. Don't get me wrong. The Clarity Acts uh resolution yesterday was very good. So I'll give you a brief summary of what happened yesterday.

[00:04:58]So the clarity act cleared the Senate Banking Committee uh which is a subcommittee that does a lot of discussion in the Senate regarding most crypto regulation.

[00:05:12]It cleared with a 15-9 by bipartisan vote.

[00:05:16]And even though there have been a lot of other uh rejections and uh extra comments that people brought up, especially from uh crypto naysayers like uh uh Elizabeth Warren, for example, all of their so-called amendments were voted down. So, this was really good, a big win for us. Now the next steps is it goes out of this subcommittee the banking committee in the US Senate and it moves to the full US Senate floor for a vote. If it passes that vote then it goes to the White House to be signed off if the White House approves to be signed into law officially.

[00:06:00]Now you guys know people have been watching this since forever and Bitcoin rallied on this. Okay, right after this got approved. Bitcoin rallied 82k. We touched multiple times right around 82k which was uh the 200 day simple moving average right here 81.9K.

[00:06:22]But you see three consecutive rejections by this level. This does not look good.

[00:06:28]I was hoping that we could go to 85 and tap the uh shorts above 85 and get a um short squeeze before fading.

[00:06:42]But even with clarity being approved, we can't even go above 81.9. So not looking good.

[00:06:52]Why is that? Well, people know that this is a short-term news. There are two sides to this. One, it significantly benefits altcoins, not as much Bitcoin.

[00:07:04]And we have already covered why in our last uh video here. You can check this live stream right here.

[00:07:11]Uh so, because it has to do with digital commodities versus digital securities and ICOs, DeFi, blah blah blah. None of that has to do with Bitcoin. Okay?

[00:07:21]Bitcoin has always been clear.

[00:07:24]Uh so that's the first side is that it benefits altcoins. The other is clarity will be uh taking a longer period of time before it actually makes into law. So the timeline is like this. First you have the banking subcommittee and then it is being merged with another uh crypto bill called the uh digital commodities consumer protection act.

[00:07:56]Okay. So the two versions merge together and they go to the full senate floor and they need 60 votes in order to clear the Senate floor uh to proceed. Now, the proc crypto party here is the Republicans. The Republicans hold 53 seats. That means we need a minimum of seven Democratic crossovers.

[00:08:26]Realistically, you know, 9 to 10 to cushion any Republicans that don't want to vote with the White House because we know the White House wants this to get passed. So, that's the first question.

[00:08:38]Can it actually pass the Senate? I think it can, but it's not a certainty. Okay.

[00:08:46]The reason why I think it can is because if they were to delay it indefinitely, they would have stopped it uh right at this point without even going to the uh Senate floor vote. Okay, so that's my reasoning. Now, the realistic timeline, even if everything gets cleared, is still a few months away. So, uh, the committee chair Tim Scott right here, yeah, committee chairman Tim Scott of the Senate Banking Committee has publicly said that he is targeting the Senate floor vote in June or July.

[00:09:26]And we know that the Senate goes on a Memorial Day recess starting from May 21st.

[00:09:34]So, we're looking at next month at the earliest for this official vote.

[00:09:41]Similarly, the White House has a target as well. And the White House crypto advisor Patrick Wit says that they want to target for July 4th.

[00:09:52]So, we could get this whole thing done within the next two months, but it's not done yet. Okay? We are looking at at least another 45 daysish.

[00:10:04]So that's the second reason why the short-term rally is hype driven and it's not fundamentals driven because all the things that are packaged into this bill are not in effect yet. Okay, so that's the other thing you need to keep in mind.

[00:10:21]And the final thing is that the clarity act even if we have it fully passed it's a institutional play. It's not going to immediately pump your favorite altcoins because think of it this way.

[00:10:42]It doesn't benefit Bitcoin. Okay?

[00:10:44]Bitcoin is a digital commodity. We already know this. So whatever pump that Bitcoin gets on the clarity act passing is not fundamentals driven. It's sentiment it's driven by sentiment.

[00:10:57]All the US exchanges can trade Bitcoin.

[00:11:00]Okay. Bitcoin is a digital commodity.

[00:11:01]Bitcoin is not an NFT. Bitcoin doesn't have ICOs. Bitcoin doesn't even have much DeFi. Bitcoin doesn't have yield.

[00:11:08]So clarity act really doesn't help Bitcoin in a meaningful way. is really helping crypto and other altcoins particularly which altcoins can it help immediately? Well, there are 16 different coins that have been declared by the SEC as digital commodities instead of digital securities right here. Okay, we covered this in depth in a live stream over a month ago and uh you can find those coins. Just look it up. Just look it up on Google.

[00:11:43]So there are uh excluding Bitcoin 15 altcoins.

[00:11:49]These are already in the SEC rule book.

[00:11:53]They have put out their interpretation already. And uh there are a few others such as whiff and fan tokens which are digital collectibles. And then you have some NFTts like ENS uh Ethereum name services which are uh digital tools.

[00:12:09]So whatever is going to get the benefit is already getting it. We are talking about the clarity act introducing a full framework.

[00:12:20]Okay. So that we not only have just 16 coins being digital commodities but we have a path for 20 30 50 other coins to become digital commodities. And that takes time. That takes the law being passed and then some sort of review application process and for there to be individual ones passing that stage and for others to say hey we're working towards that and that can drive the narrative which ultimately drives price.

[00:12:52]So before that happens the clarity act itself is not going to say anything different. It just says everything we already know. So once the Clarity Act gets passed, those 16 coins are going to be the exact 16 coins that are currently digital commodities. We're not going to have 20.

[00:13:13]So that's the other thing. Uh the passing of the law is not the event that drives altcoin uh rallies. It's going to be um how altcoin founders and how alcoin teams can fit into this law and drive themselves to be a digital commodity, a digital collectible, uh digital tool for NFT project and then they can get the traction.

[00:13:42]So it takes time, it takes momentum and I I don't even think that momentum can come in the bare market.

[00:13:49]Okay. And then speaking on that point, the final thing for the clarity act because it's targeted towards altcoins and general, you know, defy market activity, ICOs, uh, fundraising activity, etc. It doesn't target Bitcoin. What happens is you need the Bitcoin bull market to resume and you need the um sentiment to actually turn bullish because once Bitcoin's uh bull market comes back and is confirmed then you can comfortably say hey look let's buy some altcoins let's hold it for a couple months at the current moment nobody is comfortable doing that because Bitcoin is in a bare market. While we are in a bare market, the fundamental news is not able to convince people otherwise to hold altcoins. And second is while sentiment is very low, there's not that much fundraising activity through ICOs or new exchanges launching um to take advantage of the Clarity Act, allowing for free trading of all tokens. Um so all the things that can be implemented from a US business standpoint for crypto businesses there's not that much interest. So once the sentiment fully shifts around then you will see more adoption as well. So that's why I think clarity act while it's very good that we get it the real effects will be felt in the next bull run. That's what I believe. So that's why when looking at the clarity act at the moment uh this is the main thing that has been blocking the clarity act for the last nine months since it is cleared. I think most likely we will see more good news next month when they clear the Senate House uh Senate floor through a a full vote and then July hopefully we can get it through the White House. The White House signs off and then they declare this big win. So there will be probably two other sell the news events that drives short-term hype. But that's what I think they are. There are going to be hype events and whatever short-term rallies that happen on Bitcoin and on altcoins, I think they will fade. That's what I think.

[00:16:22]Uh the Clarity Act is big, but the long-term effects will be felt much later.

[00:16:27]So, for my full analysis on what the Clarity Act is, etc., You should check our previous videos and I'll compile everything into a full uh evergreen piece that you can watch on the channel every time that you are unsure about what the clarity act is.

[00:16:46]Okay.

[00:16:48]Now the next point that uh people have been very excited about is the new fat chair.

[00:16:59]So, get ready to see a lot more of this guy, Kevin Worsh.

[00:17:10]Am I still live? I'm still live. So, Kevin Worsh is the incoming Fed chair and he has just taken the position today. Wait, am I am I lagging? I'm not lagging. Okay. So, even though we have the new Fed chair and the big devil, you know, against Ray Cuts is out of out of the office now, Jerome Pal.

[00:17:38]It doesn't mean we can get a pivot on Ray Cuts or on QE anytime soon. So, here is uh the reasoning of that.

[00:17:52]So the theory is that uh since Trump appointed Kevin Worsh uh Kevin Worsh is going to be very market friendly. He's going to be more willing to cut rates and more likely to break the higher for longer consensus that Powell has locked in that each time they that they look at the data and then they don't cut. However, Kevin Worsh is in. What is the market thinking? Well, prediction markets are saying that in June we are 98% going to have no change to the rates and in July we are going to be 93% chance of a of no rate cuts.

[00:18:40]In September, we are looking at 77% chance of no rate cut and we even have a 12% chance of a rate hike.

[00:18:54]So that's on the prediction markets. Now if you think prediction markets are you can also look at the uh CME Fed watch tool which is the TRAI analysts take and they will match these exact numbers. 98% chance of note recut.

[00:19:12]And if you look at the um if you look at the rate uh the yields that will be even more telling because the yields do not lie. So both the 2-year yields and the 10-year yields are rallying today right after Kevin Wars got confirmed. So this is showing that market is pricing in both higher rates in the short term with the rising two-year yield and they are pricing in higher inflation in the long term with the rising 10-year yield.

[00:19:58]So all the signs are pointing to the market expecting no rate cuts changes with this new fat chair. They don't believe Kevin Worsh will be able to cut rates very easily. Now can we get some sort of surprise? Sure. It's possible we could get something at the next FOMC meeting in June 16 to 17. I am honestly not holding my breath for that. I think Kevin Worsh is going to come in very uh conservative and say, "Hey, look, we I respect Jerome Powell's policies. Um, I want to do things a bit differently, but again, I see that inflation is very high, so we're not going to cut." I mean, what else is he going to say? How can he possibly say that, "Oh, core PCE is very high. It's even higher than we expected and rising."

[00:20:52]and even though that's our job to not cut rates when inflation is high, we're going to do it anyways. He can't possibly say that. And he can't convince other governors at the Fed to jump on board. It's a Democratic decision.

[00:21:08]Yeah. Uh I see people saying in the chats as well, latest PPI results are massive. Yeah. the April CPI, the April PPI both came in hotter than expected, higher than the expectation.

[00:21:23]And we even we haven't even gotten the core PCE yet, which is the actual reading that the Fed uses to compare with inflation. And those might come in hot as well.

[00:21:36]So, long story short, Kevin Walsh is stuck. He wants to be friendly to the market, but he can't. And I think we are going to see at least two FOMC's where he will respect exactly what Pal has laid out do no rate cuts and then maybe after Jackson Hole in August he can make a change and that's why you see this being reflected in yields and in charts like Bitcoin. Okay, we have this new fetch but nobody really cares. Okay.

[00:22:11]Uh it's supposed to be very positive but highly doubt that it will be very positive immediately. It will take couple months at least for there to be a pivot if there is a pivot.

[00:22:26]Okay. Finally, let's look at the Trump she deal uh that has been done in Beijing.

[00:22:35]So, US China has yet again reached a uh reach deal terms. Now, this is not the first time that they did it. Uh this week, Trump along with his uh billionaire AI squad, they went to China. They talked with uh Xiinping and the Chinese the CCP and they came up with a bunch of deliverables that were quite positive.

[00:23:07]So first tariffs on 10 major Chinese technology companies were cut from 57% to 47%.

[00:23:18]Uh this is a 12. This is decent. Okay, especially considering that these Chinese companies are really targeted at AI and they need all the help in this deal to get their hands on the precious AI chips. Okay, so we're talking about companies like Alibaba, uh Tencent, Bite Dance, which is Tik Tok, okay, JD, Lenovo, Foxcon. Uh so bunch of these companies have been cleared to purchase Nvidia's H200 AI chips which everyone is dying to get their hands on. Okay. But so thus far they have been blocked. That block has been lifted which is very good. They're very good for AI stocks but they don't impact macroeconomy. They don't impact general market sentiment and certainly not Bitcoin. Okay? Those are separate. If you're invested in AI, this is really good news. If you're not invested in AI, if you're invested in Bitcoin, well, it actually doesn't impact. So, that's number one. The tariffs here do not help Bitcoin. They help AI technology companies.

[00:24:34]Second is that whenever Trump and she reaches trade war deal, it tends to revert very quickly, something like 30 to 40 days. They did the same thing in uh twice already. They did it in 2018 and they did it in 2022, February 2022. There were two rounds of trade wars. uh the la the first time was actually in the previous term of Trump and uh a previous term of she they have met before multiple times but each time that they reach a trade deal together Trump usually come out you know one to two months later calling himself uh a tariff man again and threatening to bring the tariffs back. So, whatever the short-term sentiment on tariffs, don't be alarmed if it gets fully reversed next month. Okay. So, that that's number two. The sentiment could easily shift.

[00:25:40]We know this. Okay. Trump likes Trump loves doing this.

[00:25:44]And the third thing that came out of this deal was oil. So, China has agreed to buy US crude oil.

[00:25:57]Trump specifically named uh Texas, Louisiana, and Alaska as delivery points. Now, brand crude price actually rose on this news. Look at this. Brand crude went up.

[00:26:15]Exactly why? Uh, nobody really knows.

[00:26:18]Okay. It's It's kind of weird to be honest when there's um no actually no that makes sense. Uh higher demand causes rising price. The weird thing here is that with the increase in oil price, we also saw increase in the Dixie, increase in the strength of the dollar.

[00:26:53]Now, I'm not going to get into like speculation of why because forex is honestly too much to cover.

[00:27:02]Usually the way I like to use the Dixie is that whenever you have some sort of market moving news like Trump doing a deal, tariffs, etc. It could be very positive for S&P, for NASDAQ and in this case for AI stocks as you can see in in the charts, right? S&P is very positive right now. NASDAQ still up and then AI chip stock still up. You have the Philadelphia semiconductor index. You will have the major chips stocks like Nvidia really strong like we have been saying hey Nvidia is a great buy. In fact I said it like literally down here multiple times while it was consolidating and then you have AMD you have Micron uh which are all part of this deal. You have Broadcom part of this deal. Okay, so we know what's positive, but does it actually work the same way for Bitcoin? The answer is no.

[00:28:00]Because whenever you reach one of these deals, if it leads to strength in the Dixie, that tells you that uh in in the reverse relationship, inverse relationship, it tends to be a negative effect for Bitcoin. So whenever Dixie rallies, Bitcoin tends to dump. This is one thing that I have already been watching uh since the Monday live stream. We were watching the price of Dixie. And long story short, if this leads to for whatever reason combined together strength in the dollar, watch out for Bitcoin, okay? Because Bitcoin really only benefits when there is heavy risk on behavior or uh like heavy speculated behavior or if there is heavy um ddollarization and um debasement pressure. Okay, the dollar losing strength.

[00:29:05]That's the digital gold narrative. So if the dollar gains strength, that's actually not good for Bitcoin.

[00:29:13]So with those points combined, if you're watching this Trump she deal and you are, you know, excited because oh, we have new tariffs uh being lowered. Well, read between the lines. This exact tariff uh being lowered only benefits AI companies. So if you're invested in AI, especially if you're invested in the AI chip stocks, I think as long as the AI bubble overall does not burst, the AI chip stocks will lead. They right now they are performing the best. They're performing stronger than data centers.

[00:29:54]They're performing even they're rising faster than um even AI model companies like uh Miniax etc are already public. They're even outperforming those even though the AI model companies are technically lower cap.

[00:30:12]Uh yeah, and they're just outperforming general tech completely. So chips is the place to bet on. If you still believe the AI like cycle is going to continue. Now when does the AI cycle end? Nobody really knows. That's the age-old question. We know we are starting to be in a bubble territory at least. Um, I think the bubble will at least last until all three of the major IPOs go through. SpaceX, Anthropic, and OpenAI, which are uh Q4 of this year.

[00:30:48]So, I think there are still, you know, six months to go at least, but I could be wrong. Okay? It could even be longer.

[00:30:55]So, don't quote me on that. Nobody will be able to tell you when AI stocks will top out. Nobody. But as long as they don't top out and this hot piece of fireball keeps rolling then the AI chip stocks will keep rallying. That is looking like the trend.

[00:31:13]Now this Trump she deal I don't think it benefits Bitcoin because the dollar is gaining strength.

[00:31:22]Oil is rising. So whenever oil rises that's actually a little bit negative on gold as well. So because of their inverse relationship how they are margin. So that also could be a little bit of bearish sentiment on Bitcoin.

[00:31:39]So yeah, don't get your hopes up thinking that the Trump G deal will prop up Bitcoin. I don't think that's likely. So all things considered, these three major factors, we talked about the Clarity Act, we talked about the new Fed chair, and we talked about Trump Xi doing the deal in Beijing, all three of these do not benefit Bitcoin long term because they either haven't played out yet, like uh Kevin Worsh, okay, potentially cutting rates, he's not able to cut rates yet. It has to be multiple months to go. So that is a delayed effect. It's not immediately going to uh be bullish for Bitcoin. And then you have the Clarity Act which is not only delayed a delayed effect because it'll take at least July until it happens until it makes into law and it doesn't benefit Bitcoin directly. It only benefits altcoins and altcoins need Bitcoin to rally first in order to rally. So that's two delays on top of each other. So, this isn't going to immediately pump the prices. And then finally, you have uh you know, just a just a trade deal. US, China, the trade deal does not look like it's going to help Bitcoin at all. So, get that out of out of your head. I don't think that's the case. And with these three points together, now you look at the Bitcoin price. Okay, what has Bitcoin been doing uh in this past couple months?

[00:33:22]The time to buy was in the low 60ks.

[00:33:24]I've been telling people, okay, ever since February, 61K, we told people to buy. 63K, we told people to buy. And then each time that it was above like 75, we told people, hey, look, you can DCA if you want, but make sure you actually run a DCA. Slowly space it out over six months. And if you're only looking to buy when prices are already, you know, 75K plus, it's technically not that cheap anymore. And I stand by that.

[00:33:52]Uh we are having some hard time even getting above the 200 day SMA. And you look at the actual long-term bull and bare market pivot, that's at 94.6K.

[00:34:06]We need to get above 94.6 in order to be fully confirmed in a bull market.

[00:34:12]And when is Bitcoin actually cheap?

[00:34:14]That's down here at 61K. If Bitcoin goes down to 61, then it's cheap, just like the past three bare markets. If we're not there yet, it's totally reasonable for it to go there and form a bottom.

[00:34:34]So, you have to be prepared. If you're buying at 79 and Bitcoin goes down from 79K to like 61 62K, that's a 22% drop in all three previous bare markets that have happened. So, does it is it a guarantee that this has to happen? No. But if you buy now, you cannot be surprised by this because this is a typical bare market level that gets hit.

[00:35:03]And considering how we have had all the positive news come out already, okay, the war being basically like non-events now, US China actually reaching the tariff deal, um, new fetch, okay, clarity act. So now all the short-term sentimental stuff is here, but the long-term effects haven't started. So you have this like air gap here two to three months at least where uh the new fed share needs time before he can pivot. Clear the act needs time before it gets passed and then its effects can be applied to the market and more institutions can come in or more activities can start in the US for crypto and then you have Trump which I mean doesn't even benefit crypto. So that gap is real. Next two to three months, I think Bitcoin could easily fade because there's not much short-term catalyst for it anymore. And that's why I'm very careful here. Uh 79 80K, you know, I would not be chasing the rally.

[00:36:17]Even if you don't have a Bitcoin position yet, I would say if you just wait, okay, you set some buys between 65 to 70K, you have a very good chance of hitting it.

[00:36:30]And then if we go down here, you don't even have to time the bottom.

[00:36:35]Okay? If we get down here, you look at the long-term moving average. This one is going to inch up slowly, slowly but surely. Give it another two months.

[00:36:47]We're talking about the 200 week SMA reaching something like 63K. And then if you can buy at like 66, then that's like a 5% move. You're buying, you know, 5% away from the 200 week SMA, which historically has been the best level to buy. If you guys like this content, make sure to subscribe to the channel so you don't miss our future lives, Monday, Wednesday, Friday, 2:00 p.m. Eastern time. And uh follow me on X at virtual bacon for day-to-day alpha for clips for research on these videos uh when the news drops. For example, yesterday we did coverage on the clear act results, quick summaries, my quick takes before I make these in-depth videos. So all the quickest alpha, you get them on my X account. All right, that's it. Thank you for watching and I will see you on the next video and the next live stream.